06/07/2011 08:55 am ET Updated Aug 07, 2011

Medicaid: The Next Battleground

If the Republicans get their way and turn Medicaid into a so-called block grant, millions of seniors would be thrown out of nursing homes. Middle class families would be slammed with crushing health care costs for their parents while struggling to make ends meet, save for their own retirement and send kids to college. Children and people with disabilities will go without needed care. Huge costs will be shifted to state governments, jobs will be lost and the economy will be hurt.

All of this is why Democrats have to resist the Republican plan to destroy Medicaid as fiercely as Democrats and their allies are fighting the Republican proposal to end Medicare as we know it.

Now is the time to intensify this battle. We're right on the merits, we're winning on Medicare, and the public is with us. Just as voters are overwhelmingly opposed to privatizing Medicare and replacing it with inadequate vouchers, there is also strong public support for preserving Medicaid services like critical nursing home care for seniors. Half of Americans report a personal connection to Medicaid, either for themselves or a friend or family member.

The political environment has changed dramatically since the Republican plan was first proposed. Democrats and advocacy groups have taken the offensive with a huge national Medicare fight. Democrat Kathy Hochul ran on the issue and scored an upset victory in the deeply red 26th congressional district of New York. While four Republican senators stood up to their party and rejected this misguided proposal, the rest of the GOP has closed ranks and made support of the plan a litmus test for presidential candidates.

The Medicare proposal is part of a Republican assault on the middle class that also includes this draconian attack on Medicaid and the people who benefit from it -- seniors, children, and people with chronic illnesses and disabilities. They're making these and other cuts (like tuition assistance for college students) to pay for tax cuts for the rich, and tax breaks for Big Oil and other special interests.

Medicaid covers nearly 60 million people, about half of them children. Seniors and people with disabilities make up one-quarter of Medicaid enrollees and account for two-thirds of Medicaid spending. Medicaid is the primary payer for 64 percent of all nursing home residents. These folks count on it to protect them at a time in their lives when they have no other choices.

How would the Republican Medicaid scheme work? Under the current system, state Medicaid programs receive federal matching funds based on the number of people in need and the costs of care in that state. Under the GOP's block grant proposal, states would instead receive lump sums set in advance and capped. The Republican plan eliminates Medicaid's guarantee of coverage and would slash nearly $800 billion in services over the next decade. Federal spending on Medicaid would be cut by 35 percent in 2021 and in half by 2030. So it's not a courageous innovation from House Budget Chairman Paul Ryan -- it's a shift of billions of dollars of costs to state taxpayers and a dramatic reduction in needed services.

If states wanted to maintain their current level of Medicaid services, they'd have to make unacceptable cuts in other areas or raise new revenues. In reality, those states would be forced to make substantial and painful cuts. Fewer people would be covered, and their benefits would be scaled back. Other states, such as those with Republican governors who have been agitating in favor of this plan, would impose especially deep cuts. These cuts would have a far-reaching impact on families, businesses, state governments and regional economies:

  • Millions of seniors would be left without nursing home coverage, their families forced to dig into their own pockets to care for them. The average cost of nursing home care in the U.S. is $74,800 a year, while the median household income is only about $52,000. The math just doesn't work.
  • Three million jobs would be robbed from our national economy, jeopardizing our recovery when job creation should be the top priority.
  • Millions of children in low-income families would have to make do without adequate medical services, hurting their quality of life and the quality of their education. For example, children with conditions like unmanaged asthma and chronic allergies would miss school and find it difficult to concentrate when they are in attendance, compromising their school performance and limiting their educational and economic prospects.
  • Billions of dollars in health costs will be shifted to the states, which will no longer be able to turn to the federal government for resources to care for more people in need because of economic downturns or emergencies.
  • Millions of Americans in the sandwich generation will find it impossible to save the hundreds of thousands of dollars they will need for their own retirement and health care along with the health care needs of their parents. Combined with other pressures like cuts in college aid, working and middle class families will fall farther and farther behind.
  • What's more, the block-grant plan would shift hundreds of billions of dollars in costs onto doctors and hospitals, sending private health plan premiums even higher.

The Republicans' Medicaid & Medicare plan isn't just an attack on health care -- it's a systematic effort to undermine the economic security of all of America's families. We can't preserve and expand the middle class if people don't have affordable health care they can count on. These days, people have enough to worry about with high unemployment, rising gas and food prices and mortgages they can barely afford. Democrats have forced the Republicans to blink on Medicare. They should do the same on Medicaid, and the rest of us should do our part to help.

Cross-posted on the NOW!Blog here.